Question 1

Performance incentives include all the following EXCEPT

Accepted Answer

A)  plane tickets to a resort destination. 
B)  commissions. 
C)  cost-of-living increases. 
D)  profit-sharing. 
A)  plane tickets to a resort destination. 
B)  commissions. 
C)  cost-of-living increases. 
D)  profit-sharing.

Question 2

HR-related performance measures for a variable pay plan include all the following EXCEPT

Accepted Answer

A)  absenteeism costs. 
B)  workers compensation claims. 
C)  increase in quantity of output per employee. 
D)  accident rates. 
A)  absenteeism costs. 
B)  workers compensation claims. 
C)  increase in quantity of output per employee. 
D)  accident rates.

Question 3

As director of HR you need to calculate the return on investment of a new differential piece-rate system.To do this you need to calculate

Accepted Answer

A)  the ratio of the cost of the old incentive system to the cost of the new incentive system multiplied by the dollar value of the increase in production due to the new system. 
B)  the dollar value of the increase in production divided by the cost of the new incentive system. 
C)  the ratio of the cost savings of the new incentive system compared with the return on investment which the shareholders expect. 
D)  the dollar value of the additional production minus the cost of the new incentive system divided by the cost of the new incentive system 
A)  the ratio of the cost of the old incentive system to the cost of the new incentive system multiplied by the dollar value of the increase in production due to the new system. 
B)  the dollar value of the increase in production divided by the cost of the new incentive system. 
C)  the ratio of the cost savings of the new incentive system compared with the return on investment which the shareholders expect. 
D)  the dollar value of the additional production minus the cost of the new incentive system divided by the cost of the new incentive system

Question 4

All of the following are typical performance measures in gainsharing plans EXCEPT

Accepted Answer

A)  fixed costs. 
B)  labor costs. 
C)  overtime hours. 
D)  quality levels. 
A)  fixed costs. 
B)  labor costs. 
C)  overtime hours. 
D)  quality levels.

Question 5

For a profit-sharing plan to be effective,management must

Accepted Answer

A)  increase innovative solutions to technical problems. 
B)  not have high expectations of performance impact in the first year of the program. 
C)  be willing to disclose accurate financial and profit information to employees. 
D)  stabilize profits so that the annual payout is consistent. 
A)  increase innovative solutions to technical problems. 
B)  not have high expectations of performance impact in the first year of the program. 
C)  be willing to disclose accurate financial and profit information to employees. 
D)  stabilize profits so that the annual payout is consistent.

Question 6

A disadvantage of "employee of the month" type awards is that

Accepted Answer

A)  they can be seen as favoritism. 
B)  they are typically awarded on the basis of objective criteria. 
C)  it is difficult to link these awards with specific performance criteria. 
D)  eventually all employees will have been employee of the month and the award will have lost its distinctiveness. 
A)  they can be seen as favoritism. 
B)  they are typically awarded on the basis of objective criteria. 
C)  it is difficult to link these awards with specific performance criteria. 
D)  eventually all employees will have been employee of the month and the award will have lost its distinctiveness.

Question 7

Research shows that individual pay-for-performance compensation systems work best when they are accompanied by

Accepted Answer

A)  high levels of teamwork and cooperation among co-workers. 
B)  directive supervision and strong central leadership. 
C)  an entrepreneurial and individualistic organizational culture. 
D)  employee psychological commitment to the goals of the organization. 
A)  high levels of teamwork and cooperation among co-workers. 
B)  directive supervision and strong central leadership. 
C)  an entrepreneurial and individualistic organizational culture. 
D)  employee psychological commitment to the goals of the organization.

Question 8

Give two examples of organizational level incentives and explain how they link individual and firm performance.

Accepted Answer

Profit-sharing plans and ESOPs are two t

Question 9

A differential piece-rate system pays employees

Accepted Answer

A)  one piece-rate wage for standard production, with deductions for producing below quota. 
B)  one piece-rate wage for units produced up to a standard output, and a higher piece-rate wage for units produced over the standard. 
C)  a higher rate per piece for employees with more experience and seniority. 
D)  differential wages depending on the differing responsibilities in the production of each unit. 
A)  one piece-rate wage for standard production, with deductions for producing below quota. 
B)  one piece-rate wage for units produced up to a standard output, and a higher piece-rate wage for units produced over the standard. 
C)  a higher rate per piece for employees with more experience and seniority. 
D)  differential wages depending on the differing responsibilities in the production of each unit.

Question 10

The CEO of MasterFiber Textiles attended a conference where he spoke with the CEO of Golden Fleece Manufacturing.Golden Fleece has had great success in implementing an individual pay-for-performance system.The CEO of MasterFiber has directed the vice president of HR to implement the Golden Fleece method at MasterFiber.The FIRST concern of the VP of HR should be

Accepted Answer

A)  Can current executive compensation be retained under this system? 
B)  Is the plan simple or complex to administer? 
C)  Does the plan fit with the business strategies and culture at MasterFiber? 
D)  Can MasterFiber afford to pay higher compensation to its employees? 
A)  Can current executive compensation be retained under this system? 
B)  Is the plan simple or complex to administer? 
C)  Does the plan fit with the business strategies and culture at MasterFiber? 
D)  Can MasterFiber afford to pay higher compensation to its employees?

Question 11

An individual-level pay-for-performance system would be LEAST effective for which of the following employees?

Accepted Answer

A)  a dog groomer at a large pet store. 
B)  a sales clerk at a fashionable women's shoe store. 
C)  the CEO of a middle-sized builder of manufactured housing. 
D)  a marketing specialist on a cross-functional product development team. 
A)  a dog groomer at a large pet store. 
B)  a sales clerk at a fashionable women's shoe store. 
C)  the CEO of a middle-sized builder of manufactured housing. 
D)  a marketing specialist on a cross-functional product development team.

Question 12

The ____ type of pay-for-performance system is most likely to induce employees to behave unethically.

Accepted Answer

A)  sales commission 
B)  ESOP 
C)  differential piece-rate 
D)  gainsharing 
A)  sales commission 
B)  ESOP 
C)  differential piece-rate 
D)  gainsharing

Question 13

Use of the company helicopter,country club memberships,first class air travel,and a chauffeured limousine are examples of

Accepted Answer

A)  executive mandates. 
B)  perquisites. 
C)  golden handcuffs. 
D)  performance incentives. 
A)  executive mandates. 
B)  perquisites. 
C)  golden handcuffs. 
D)  performance incentives.

Question 14

All of the following situations would support successful use of group/team incentives EXCEPT

Accepted Answer

A)  A group of health-care professionals in different specialties works together to care for a particular patient. 
B)  Sales representatives for veterinary pharmaceuticals are each assigned different geographic territories. 
C)  The organizational culture in an engineering consulting firm promotes cooperation and mutual respect. 
D)  A team of advertising and marketing specialists are working on the same campaign for a client. 
A)  A group of health-care professionals in different specialties works together to care for a particular patient. 
B)  Sales representatives for veterinary pharmaceuticals are each assigned different geographic territories. 
C)  The organizational culture in an engineering consulting firm promotes cooperation and mutual respect. 
D)  A team of advertising and marketing specialists are working on the same campaign for a client.

Question 15

Poseidon Oceanic Supply has introduced a new sales compensation system that rewards sales staff based on a combination of individual goals and group sales goals.Previously,sales staff had been on individual salaries supplemented with subjective annual bonuses.In implementing this program,the management of Poseidon hopes to

Accepted Answer

A)  motivate sales staff on the basis of individual entrepreneurialism. 
B)  increase the amount of service to existing Poseidon customers. 
C)  reduce opportunities for unethical behavior by sales staff. 
D)  encourage teamwork among the sales staff. 
A)  motivate sales staff on the basis of individual entrepreneurialism. 
B)  increase the amount of service to existing Poseidon customers. 
C)  reduce opportunities for unethical behavior by sales staff. 
D)  encourage teamwork among the sales staff.

Question 16

The most common type of group/team incentive plan used by organizations is paying

Accepted Answer

A)  all team members the same base pay with equal bonuses based on team performance. 
B)  team members different base pay, with equal bonuses based on team performance. 
C)  all team members the same base pay with varying bonuses based on individual contribution to the team's performance. 
D)  team members different base pay, with varying bonuses based on individual contribution to the team's performance. 
A)  all team members the same base pay with equal bonuses based on team performance. 
B)  team members different base pay, with equal bonuses based on team performance. 
C)  all team members the same base pay with varying bonuses based on individual contribution to the team's performance. 
D)  team members different base pay, with varying bonuses based on individual contribution to the team's performance.

Question 17

What are variable pay plans?

Accepted Answer

A)  methods of tying compensation to the Consumer Price Index (CPI) in order to keep up with inflation 
B)  additional tangible rewards given to employees for performance beyond normal expectations 
C)  compensation that increases as employees gain new job-related knowledge, skills, and abilities 
D)  incentives to meet required performance standards 
A)  methods of tying compensation to the Consumer Price Index (CPI) in order to keep up with inflation 
B)  additional tangible rewards given to employees for performance beyond normal expectations 
C)  compensation that increases as employees gain new job-related knowledge, skills, and abilities 
D)  incentives to meet required performance standards

Question 18

Should performance incentives for teams be equal for all team members or based on individual performance?

Accepted Answer

If a team performs exceptionally well an

Question 19

When ethical considerations are paramount,paying sales representatives on straight commission is unwise.

Accepted Answer

A) True 
 B)False

Question 20

The purpose of organizational-level incentives is to

Accepted Answer

A)  reward each employee for the performance of the entire company. 
B)  aid in recruiting individualistic and entrepreneurial employees. 
C)  motivate functional competition among employees to increase total performance. 
D)  create an organizational culture of ethical behavior. 
A)  reward each employee for the performance of the entire company. 
B)  aid in recruiting individualistic and entrepreneurial employees. 
C)  motivate functional competition among employees to increase total performance. 
D)  create an organizational culture of ethical behavior.

Performance incentives include all the following EXCEPT

HR-related performance measures for a variable pay plan include all the following EXCEPT

As director of HR you need to calculate the return on investment of a new differential piece-rate system.To do this you need to calculate

All of the following are typical performance measures in gainsharing plans EXCEPT

For a profit-sharing plan to be effective,management must

A disadvantage of "employee of the month" type awards is that

Research shows that individual pay-for-performance compensation systems work best when they are accompanied by

Give two examples of organizational level incentives and explain how they link individual and firm performance.

A differential piece-rate system pays employees

An individual-level pay-for-performance system would be LEAST effective for which of the following employees?

The ____ type of pay-for-performance system is most likely to induce employees to behave unethically.

Use of the company helicopter,country club memberships,first class air travel,and a chauffeured limousine are examples of

All of the following situations would support successful use of group/team incentives EXCEPT

The most common type of group/team incentive plan used by organizations is paying

What are variable pay plans?

Should performance incentives for teams be equal for all team members or based on individual performance?

When ethical considerations are paramount,paying sales representatives on straight commission is unwise.

The purpose of organizational-level incentives is to

Human Resource Management in Organizations

Strategic HR Management and Planning

Equal Employment Opportunity

Workers,Jobs,and Job Analysis

Human Resource Planning and Retention

Recruiting and Labor Markets

Selecting Human Resources

Training Human Resources

Talent Management

Performance Management and Appraisal

Total Rewards and Compensation

Managing Employee Benefits

Risk Management and Worker Protection

Employee Rights and Responsibilities

Union/Management Relations

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Exam 12: Incentive Plans and Executive Compensation

Performance incentives include all the following EXCEPT

HR-related performance measures for a variable pay plan include all the following EXCEPT

As director of HR you need to calculate the return on investment of a new differential piece-rate system.To do this you need to calculate

All of the following are typical performance measures in gainsharing plans EXCEPT

For a profit-sharing plan to be effective,management must

A disadvantage of "employee of the month" type awards is that

Research shows that individual pay-for-performance compensation systems work best when they are accompanied by

Give two examples of organizational level incentives and explain how they link individual and firm performance.

A differential piece-rate system pays employees

An individual-level pay-for-performance system would be LEAST effective for which of the following employees?

The ____ type of pay-for-performance system is most likely to induce employees to behave unethically.

Use of the company helicopter,country club memberships,first class air travel,and a chauffeured limousine are examples of

All of the following situations would support successful use of group/team incentives EXCEPT

The most common type of group/team incentive plan used by organizations is paying

What are variable pay plans?

Should performance incentives for teams be equal for all team members or based on individual performance?

When ethical considerations are paramount,paying sales representatives on straight commission is unwise.

The purpose of organizational-level incentives is to

Human Resource Management in Organizations

Strategic HR Management and Planning

Equal Employment Opportunity

Workers,Jobs,and Job Analysis

Human Resource Planning and Retention

Recruiting and Labor Markets

Selecting Human Resources

Training Human Resources

Talent Management

Performance Management and Appraisal

Total Rewards and Compensation

Managing Employee Benefits

Risk Management and Worker Protection

Employee Rights and Responsibilities

Union/Management Relations

Filters